Correlation Between Garuda Metalindo and Global Mediacom
Can any of the company-specific risk be diversified away by investing in both Garuda Metalindo and Global Mediacom at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Garuda Metalindo and Global Mediacom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Garuda Metalindo Tbk and Global Mediacom Tbk, you can compare the effects of market volatilities on Garuda Metalindo and Global Mediacom and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Garuda Metalindo with a short position of Global Mediacom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Garuda Metalindo and Global Mediacom.
Diversification Opportunities for Garuda Metalindo and Global Mediacom
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Garuda and Global is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Garuda Metalindo Tbk and Global Mediacom Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Mediacom Tbk and Garuda Metalindo is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Garuda Metalindo Tbk are associated (or correlated) with Global Mediacom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Mediacom Tbk has no effect on the direction of Garuda Metalindo i.e., Garuda Metalindo and Global Mediacom go up and down completely randomly.
Pair Corralation between Garuda Metalindo and Global Mediacom
Assuming the 90 days trading horizon Garuda Metalindo Tbk is expected to generate 0.88 times more return on investment than Global Mediacom. However, Garuda Metalindo Tbk is 1.14 times less risky than Global Mediacom. It trades about 0.09 of its potential returns per unit of risk. Global Mediacom Tbk is currently generating about -0.05 per unit of risk. If you would invest 68,843 in Garuda Metalindo Tbk on November 28, 2024 and sell it today you would earn a total of 62,657 from holding Garuda Metalindo Tbk or generate 91.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Garuda Metalindo Tbk vs. Global Mediacom Tbk
Performance |
| Timeline |
| Garuda Metalindo Tbk |
| Global Mediacom Tbk |
Garuda Metalindo and Global Mediacom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Garuda Metalindo and Global Mediacom
The main advantage of trading using opposite Garuda Metalindo and Global Mediacom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Garuda Metalindo position performs unexpectedly, Global Mediacom can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Global Mediacom will offset losses from the drop in Global Mediacom's long position.| Garuda Metalindo vs. Indo Kordsa Tbk | Garuda Metalindo vs. Indospring Tbk | Garuda Metalindo vs. Kabelindo Murni Tbk | Garuda Metalindo vs. Blue Bird Tbk |
| Global Mediacom vs. Mitra Keluarga Karyasehat | Global Mediacom vs. Surya Citra Media | Global Mediacom vs. Matahari Department Store | Global Mediacom vs. Puradelta Lestari PT |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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